Cost of production network seeks more participants

Instead of comparing to a provincial average, a beef producer can use the Cost of Production Network and find a system that’s similar to their farm. | Screencap via YouTube/Brenna Grant

Canfax is seeking more ranchers to participate in its Cost of Production Network.

Earlier this year the marketing and analysis division of the Canadian Cattlemen’s Association launched a project to understand the varying costs of raising beef cows across Canada.

The idea was to replace provincial averages for cost of production, which can be deceptive because on-farm practices and environmental conditions differ widely within a province.

“The network provides benchmarks based on specific production systems. This will allow producers to select the benchmark that makes the most sense for their operation, regardless of provincial boundaries,” Canfax says in a July report, summarizing the results from 2020.

“It also recognizes that within a province, there is significant variation in the choice of production systems.”

Instead of comparing to a provincial average, a beef producer can use the Cost of Production Network and find a system that’s similar to their farm.

For instance, one of the base line farms in the network is a “cow-calf operation producing homegrown feed located in a dry mixed grassland region of Saskatchewan.”

If a farmer raises cattle in a mixed-grassland region, anywhere on the Prairies, he can compare his costs to the data from that benchmark farm.

Canfax developed the benchmark data through focus groups it held with 115 cattle producers from across the country.

“Our main goal this first year was to provide national coverage. And we succeeded in doing that, from British Columbia to Prince Edward Island,” said Brenna Grant, manager of Canfax research services.

Grant’s presentation on the Cost of Production Network was part of the Canadian Beef Industry Conference, a virtual event held in late August and early September.

The focus groups allowed Grant and Canfax to develop 28 benchmark farms to represent different climates, eco-regions and farm practices, such as a mixed farm with cow-calf, backgrounding and cash crop production in Alberta’s Rocky Mountain region.

On the Canfax website, a cattle rancher can click on that Rocky Mountain benchmark farm and look at cost and revenue data, including things like the cost of production per cow wintered for the last five years or a whole farm net income from 2015-20. As well, detailed data on a multitude of costs, such as labour, machinery, purchased feed and many other items, are available.

“There’s also a summary of 2020 results for all of the farms. This might be the easiest for someone to get a big picture (on) what the network is doing,” Grant said.

The benchmark farms, the data and information on the Canfax website are just the beginning for the Cost of Production Network, said Grant.

“The goal of the network is not just to provide benchmarks… (but) what is possible for a cow-calf operation to achieve? Not the average, but the range of possibilities, under different production systems.”

There are some holes in the network. Grant is missing data on certain cow-calf systems. This fall, she hopes to sign up producers who fit the following categories:

  • Large herds, with more 500 head, in British Columbia.
  • Dairy-beef operations in Alberta.
  • Bale grazing and start-up farms in Manitoba.
  • Dairy beef farms in Ontario.
  • Cash crop, mixed farms with silage ration in Quebec.

Producers who participate receive a $500 honorarium.

“They will (also) receive a summary of their baseline data, with key performance indicators… and a summary of future farm scenarios,” Grant said.

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